Great Aussie inheritance debate: Why 'entitled' young Aussies 'shouldn't expect it'

Young Aussies have been warned about an emerging trend that could derail their plans later in life. Spending the Kids' Inheritance (SKI) is a movement being adopted globally and it's encouraging people to splash their hard-earned cash in retirement rather than squirrel it away for future generations.

Australia is undergoing the largest wealth transfer in history; to the tune of $3.5 trillion. This is while millions of Aussies have expectations of an inheritance.

This could be to help them crack into a horror housing market, or simply provide relief in the cost-of-living crisis. But single mum Trudy Wertheim told Yahoo Finance there needs to be a mindset shift amongst "entitled" younger generations.

"There is a whole generation of kids being raised, who perhaps their carers didn't instil in them from an early age, that if you do work hard, you can have everything you want out of life and more," she said.

"There are generations coming through that just don't expect to work. They expect to inherit or be given or bought a family home by their parents."

The Western Australian runs a SKI group online where older generations can discuss some of the travel opportunities their wealth presents, particularly when it comes to whether they hand over their money.

This isn't to say she doesn't sympathise with younger generations struggling at the moment.

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Wertheim said her heart goes out to those trying to make ends meet and are desperately striving to get on to the property ladder.

However, the inheritance conundrum puts parents in a tricky situation. Should they be allowed to enjoy their lives, or is it their responsibility to live frugally for the sake of the next generation?

Are you expecting to receive or struggle to give an inheritance? Email stew.perrie@yahooinc.com

Do my children expect me to hand over an inheritance?

Wertheim is a single mother and said she worked incredibly hard for decades to support her family.

This is why she believes she deserves to enjoy her twilight years.

Being in her mid-50s and part of the Gen X group, Wertheim has started to think of her retirement and what to do with her assets.

She said her kids, aged in their early 30s, completely supported her SKI mentality.

"They've never said to me, 'We expect you to not spend your hard-earned savings, because that's ours," she told Yahoo Finance.

"Never has that come out of their mouth. My children have said to me, 'Go and live your life. Do what you want to do. We just want you to be happy mum'."

This attitude came down to how Wertheim raised her children, she said, adding that others could benefit from shifting expectations.

Alex Ryland also threw his support behind his parents, Leanne and Leon, who have spent more than $170,000 on around-the-world trips and boasted he wouldn't be getting much more than trinkets from their vaccations.

"They've raised me to be self-sufficient," he said. "I don't need them for money."

Boomers and Gen-X pressured to prop up younger generations

Parents like Wertheim are facing an unprecedented push to provide a hefty inheritance to their children.

This is in part due to the homes they own skyrocketing in value, allowing some to build property portfolios while younger generations need much larger percentages of their incomes for a deposit before getting a look in for a loan.

A recent survey by Finder indicated one-third of Australians expect to receive an inheritance.

But now, with the current economic conditions, there's another question for retirees: When do you hand it over?

Interestingly, two in five, equivalent to 8.3 million people, admitted they would rather have it as a gift while the family member is still alive instead of waiting until they die.

Sarah Megginson, personal finance expert at Finder, said those who choose to gift early will get to see their child or grandchildren enjoy the money.

"The financial windfall at a younger age gives them more opportunity to use it towards something that drastically improves their life, like a deposit on a home or investing it in education," she said.

However, this can also present awkward scenarios.

In the case of Wertheim, one of her children has bought a home and the other is renting.

"Maybe I should be giving the child that's renting money to help her buy a house, but how is that fair to the child that already got into the housing market before this started?" Wertheim asked.

"I'll have to give them money as well. I feel like society is putting that pressure on me."

Jo Hilder is also in her mid-50s and she and her husband are working as hard as possible to ensure they can actually retire. But she told Yahoo Finance it's hard to do that when costs are already so high.

"A lot of a lot of our age group are not able to leave anything for our kids," she said. That grieves us, that makes us really sad that we're having to use everything that we have just to get by.

"We don't know how much will be left when we're gone for them to actually benefit from."

Challenges for older Aussies to enjoy retirement

The average age of retirement has been pushed back to a number not seen in decades, with men and women leaving work at 61.6 and 63.3, respectively.

Wertheim said this puts older Australians in a race against time to enjoy their latter years as age presents new challenges.

"Insurance companies won't insure you if you have an accident overseas, and that just gets harder with each decade you get older," she said.

"I don't want to be in Bali at 80 and falling down and breaking my leg."

She explained that's why you're seeing Baby Boomers living it up while they can.

So what's Wertheim going to leave to her children?

Her twins will get her paid-off property and the grandchildren will get smaller amounts.

As for her cash, that's hers to spend while she's alive, and plenty of her SKI members agree.

"My kids are happy for me to spend it. They can have our house, which is more than I got when my parents passed away," wrote one.

"They earned it they can spend it. So many entitled people," said another.

A third added: "The kids inherit your house. Your money is your business to spend how you like."

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